The course, produced by the Institute for New Economic Thinking and taught by the Institute’s Perry Mehrling, explores money markets and how they work, both in the U.S. and internationally.

After taking the course, you will be able to understand everyday financial discourse at a high level. The class will give you extensive knowledge of how money markets work and is designed to give you the tools be able to spot the next crisis before it hits. You’ll learn what Professor Mehrling calls “the money view,” which will teach you the key institutions that underlie the financial system and give you ideas for how they could be reformed to prevent another collapse.

Sign up for the class here, and read below for an introduction to the class from Professor Mehrling!

The last three or four decades have seen a remarkable evolution in the institutions that comprise the modern monetary system. The financial crisis of 2007-2009 is a wakeup call that we need a similar evolution in the analytical apparatus and theories that we use to understand that system. Produced by the Institute for New Economic Thinking, this course is an attempt to begin the process of new economic thinking, by reviving and updating some forgotten traditions in monetary thought that have become newly relevant.

Three features of the new system are central.

Most important, the intertwining of previously separate capital markets and money markets has produced a system with new dynamics as well as new vulnerabilities. The financial crisis revealed those vulnerabilities for all to see. The result was two years of desperate innovation by central banking authorities as they tried first this, and then that, in an effort to stem the collapse.

Second, the global character of the crisis has revealed the global character of the system, which is something new in postwar history but not at all new from a longer time perspective. Central bank cooperation was key to stemming the collapse, and the details of that cooperation hint at the outlines of an emerging new international monetary order.

Third, absolutely central to the crisis was the operation of key derivative contracts, most importantly credit default swaps and foreign exchange swaps. Modern money cannot be understood separately from modern finance, nor can modern monetary theory be constructed separately from modern financial theory. That's the reason this course places dealers, in both capital markets and money markets, at the very center of the picture, as profit-seeking suppliers of market liquidity to the new system of market-based credit.

Course Syllabus

Introduction

1: The Four Prices of Money

2: The Natural Hierarchy of Money

3: Money and the State: Domestic

4: The Money View, Macro and Micro

Banking as a Clearing System

5: The Central Bank as a Clearinghouse

6: Federal Funds, Final Settlement

7: Repos, Postponing Settlement

8: Eurodollars, Parallel Settlement

Banking as Market Making

9: The World that Bagehot Knew

10: Dealers and Liquid Security Markets

11: Banks and the Market for Liquidity

12: Lender/Dealer of Last Resort

Course Format

The class will consist of lecture videos, shot live in the classroom but then edited down into digestible segments, with integrated quiz questions and animated slide videos added. There will also be weekly quizzes, and a final exam.

FAQ

What is the coolest thing I'll learn if I take this class? You will learn to read, understand, and evaluate professional discourse about the current operation of money markets at the level of the Financial Times.

Professor Mehrling's Course on Money clarifies how money / credit flows and sources connect across Wall Street's big banks , Shadow banks and the Fed. It reveals hierarchies gold , currency, deposits, credit - and whose most at risk if the system contracts

Various ways to learn from this:

-how the system operates - including how did it get to today's state of operations - ( 30 year ago online computer networks did not exist and so the system was wholly different with eg a lot more community/regionally grounded banks)

-who gains and loses from the system - is it what most Americans need to build futures with?

-if you are in another country what are the knock-on effects of this system and is your own money system subject to similar or different risks?

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Different contexts/concerns can help to give this conversation practical depth - here are what 3 of us have been questioning

Dolores

-so what impacts does this have on the futures of people in Argentina and what other aspects of our nation's economy need to be reviewed at the same time as Mehrling's knowledge

people who joined in email discussions with Dolores:

*Hugh one of world's leading questioners of microfinance who lives in Argentina

*Steven whose low cost virtual university aims to developed financial awareness- his facebook- a link on how Fed bought up economists

personal guidelines: i started to save money when i decided NOT to use credit card.. and saved heaps.. I recommend the opposite to the culture of the advertising industry of what you NEED to be happy everybody is borrowing to buy useless things

Douglas Young I live in the UK for now. A Brit, but spent most of my life abroad in Portugal and Japan.

The most exciting thing is the building of the model as all money as debt - IOUs or whatever - making a model of the financial system as this. A dynamic model of money as Debt, all encompassing, is very different I think. It ties in with David Graeber's 'Debt'.which is a paradigm changing view that money only came after debt - he traces it back to the original Sumerian temple records of obligations and debt owed

It does collapse - the Sumerians had a debt jubilee every so often when all debts were forgiven, and I think debt jubilees are mentioned in the Bible.

Beyond chris' point : I'm suspicious of localism though - you think the Wall street fat cats are corrupt but look how corrupt the local banks

Then dont forget why inflation can be all the peoples enemy- inflate the government debts and destroy people's savings - especially the pensioners who may die anyway before they realise they've been robbed.

Chris- I live in Washington Dc but I come from a Scottish family tree. Since 1700s when an international banking scam bankrupted Scotland and we were taken over by English empire, Scots from Adam Smith on have impudently questioned who's the system for

I try and analyse any system by is if pro-youth (ie sustaining next generation) or anti-youth

So for example whenever a government bails out a failed bank its the next generation that pick up the debt- as it is with overspending on public health/pensions surveys today compared with who'll be able to work and pay for that tomorrow

There are lots of ways that I feel concerned that Mehrling is clarifying how anti-youth the system has become but at the very least if you are going to be ruled by a few top heavy wall streets then their transparency should be much different than what we have all suffer the last 12 years

While not dismissing local risks, I like to review how much of a community's exchange is non-monetised. For example the ways families swap looking after children. Top-down mindsets that monetise everything penalise families and erode community trust

Please insert a conversation

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Will the next 5 years see more money tipping points? Where if at all do people get a chance to engage in choices made. Some spaces I watch

Dad (Norman Macrae) created the genre Entrepreneurial Revolution to debate how to make the net generation the most productive and collaborative . We had first participated in computer assisted learning experiments in 1972. Welcome to more than 40 years of linking pro-youth economics networks- debating can the internet be the smartest media our species has ever collaborated around?

1972: Norman Macrae starts up Entrepreneurial Revolution debates in The Economist. Will we the peoples be in time to change 20th C largest system designs and make 2010s worldwide youth's most productive time? or will we go global in a way that ends sustainability of ever more villages/communities? Drayton was inspired by this genre to coin social entrepreneur in 1978 ,,continue the futures debate here